CBA posts record first half cash profit

Commonwealth Bank of Australia has posted a record first half profit. Picture: Ian Waldie/Bloomberg News

COMMONWEALTH Bank has lifted its first-half cash profit two per cent to $4.9 billion.

The lender said statutory net profit was up six per cent to $4.8 billion and operating income had risen six per cent to $13.1 billion in the six months to December 31.

CBA will pay a fully franked interim dividend of $1.99 per share, up one cent.

The bank also announced it is lifting some mortgage rates including those for interest-only investor loans.

Rates for interest-only investor loans will rise by 0.12 per cent and for viridian line of credit mortgages, that allow customers to use their equity for other investments, by 0.40 per cent.

Commonwealth Bank’s new interest only standard variable rate for investors will be 5.68 per cent from April 3.

“We have invested carefully but consistently over many years, leading to ongoing revenue and balance sheet growth, and continuous innovation for our customers,” chief executive Ian Narev said.

Net interest margin — the difference between the interest a bank makes on loans and the interest it pays on funds to finance them — decreased by 0.04 percentage points to 2.11 per cent.

In a statement the bank said it was committed to meeting its regulatory requirements while ensuring it can provide for the long term sustainability of the Australian housing market.

“Today CBA has announced changes to some mortgage rates: interest only home loan rates for investors will rise by 12 basis points and Viridian Line of Credit (VLOC) products will increase by 4 basis points. The new interest only standard variable rate for investors will be 5.68 per cent per annum, VLOC will move to 5.82 per cent per annum,” the statement read.

The changes will be effective from April 3.

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